Summary
PepsiCo Inc.'s (PEP) second quarter of 2017 filing shows steady revenue growth, with net revenue increasing by 2% to $15.7 billion for the 12-week period and $27.8 billion for the 24-week period, compared to the prior year. Diluted earnings per share (EPS) also saw a healthy increase, rising by 6% to $1.46 for the 12-week period and by 18% to $2.38 for the 24-week period. The company's operating profit experienced growth across most segments, with notable increases in Europe Sub-Saharan Africa (ESSA) and Asia, Middle East and North Africa (AMENA), partly driven by strategic initiatives and a gain from the sale of a minority stake in Britvic. The company continued its productivity initiatives, incurring restructuring charges but also realizing cost savings. Despite some headwinds from commodity cost inflation and unfavorable foreign exchange, particularly in AMENA and Latin America, PepsiCo demonstrated resilience through effective net pricing and cost management. The company also reaffirmed its commitment to returning capital to shareholders, announcing a 7.0% increase in its annualized dividend and expecting to return approximately $6.5 billion in 2017 through dividends and share repurchases.
Financial Highlights
50 data points| Revenue | $15.71B |
| Cost of Revenue | $7.06B |
| Gross Profit | $8.65B |
| SG&A Expenses | $5.73B |
| Operating Income | $2.92B |
| Interest Expense | $265.00M |
| Net Income | $2.10B |
| EPS (Basic) | $1.47 |
| EPS (Diluted) | $1.46 |
| Shares Outstanding (Basic) | 1.43B |
| Shares Outstanding (Diluted) | 1.44B |
Key Highlights
- 1Net revenue increased by 2% to $15.71 billion for the 12 weeks ended June 17, 2017, and by 2% to $27.76 billion for the 24 weeks ended June 17, 2017.
- 2Diluted EPS rose by 6% to $1.46 for the 12-week period and by 18% to $2.38 for the 24-week period.
- 3Operating profit for the 12-week period increased by 1% to $2.99 billion, and by 7% to $4.92 billion for the 24-week period.
- 4ESSA and AMENA segments showed significant operating profit growth (49% and 104% respectively for 24 weeks), partly due to a gain from the Britvic stake sale and a prior year impairment charge reversal.
- 5The company announced a 7.0% increase in its annualized dividend to $3.22 per share.
- 6Free cash flow for the 24-week period was $1.39 billion, a decrease of 38% from the prior year, largely due to working capital changes.
- 7Share repurchases totaled $0.94 billion and $2.18 billion in dividends were paid during the 24-week period.